MCB Bank Limited · With reference to significant holding, the following entities are associates of the Bank; Adamjee Insurance Company Limited Holding: 21.47% Euronet Pakistan (Private)

Presented by: Hammad Khalid Head Investor Relations, Financial Reporting & Taxation

MCB Bank Limited Investors Briefing Financial Performance Analysis September 30, 2017

MCB is one of the oldest banks of Pakistan, incorporated in 1947. It was privatized in 1991. To accede to international capital markets, the Bank launched Global Depositary Receipts (GDRs) in 2006. It was the first Pakistani Bank that got its GDRs listed on the London Stock Exchange. In 2008, the Bank entered into a strategic partnership with Maybank, Malaysia, which owns 20% stake in it through Mayban International Trust (Labuan) Berhad. Local Branches : 1,405 Foreign Branches : 11 (Including 1 EPZ branch)

Subsidiaries MCB Financial Services Limited Holding: 99.99% Profile: Float, administer and manage modaraba funds and acts as trustees of various mutual funds. MNET Services (Private) Limited Holding: 99.95% Profile: Service providers for Electronic Transactions to various financial institutions/banks including related services in Information Technology, software and data processing. MCB Islamic Bank Limited Holding: 100% Profile: Islamic & Shria‟h compliant banking. MCB - Arif Habib Savings & Investments Limited Holding: 51.33% Profile: Asset management, investment advisory, portfolio management and underwriting. “MCB Leasing” Closed Joint Stock Company, Azerbaijan Holding: 99.94% Profile: Leases various types of industrial equipment, public transports, real estate and retail auto leases. With reference to significant holding, the following entities are associates of the Bank; Adamjee Insurance Company Limited Holding: 21.47% Euronet Pakistan (Private) Limited Holding: 30%

Group Structure

Investor Relations MCB Bank Limited

MCB Core Values Integrity , Innovation, Excellence, Customer Centricity, Respect

Bank for Life

MARKET LEADERSHIP

> Amongst top 3 Banks in Pakistan

> Maintain first-mover‟s advantage in new businesses

> Socially Responsible Organization > Strong Brand Recognition

PEOPLE FOCUS

providing customers‟ need based solutions in

> Trade Finance

> Collection & Payments Business

> Commodity Business > Middle Markets

> Specialized sales to Financial Institutions

RISK DISCIPLINE

> Pro-active Risk-Portfolio Management

> Conscientious approach to NPL recoveries

> Policies & operations aligned with risk philosophy

> Robust capital & liquidity management > Effective risk-management based on Compliance

& Internal Audit results & IT Governance

PRODUCTS & SERVICES

> Continuous & sustainable earnings growth

> Customer centricity in sales & service

> Efficient mechanism for service delivery

> Maintain & identify new competitive advantages

Strategic pillars


One of the largest Commercial Bank in Pakistan

Financial Strength Domestic and International footprint

Assets PKR 1,309 bn (US$ 12.4 bn)

Deposits PKR 962 bn (US$ 9.1bn)

RoA 2.16%

RoE 19.93%

Profit before Tax PKR 26.0 bn (US$ 248 mn)

Advances (Gross) PKR 487 bn (US$ 4.6 bn)

Market capitalization PKR 248 bn (US$ 2.3bn)

Domestic Branches 1,405

Associates

Adamjee Insurance Company Limited Euronet Pakistan (Pvt) Limited

Subsidiaries

MCB Financial Services MNET Services (Private) Limited MCB - Arif Habib Savings and Investments Limited "MCB Leasing" Closed' Joint Stock Company MCB Islamic Bank Limited

Foreign Branches

11 (Sri Lanka : 8, Bahrain : 1, EPZ : 1,

UAE : 1) 1 Rep Office in Dubai


No. of accounts 7.3 mn # of ATMs 1,383

Highest Credit Rating by PACRA Long Term AAA [triple A] and Short Term A1+ [A one plus]

Rs. in mln

Statement of Financial Position


Unconsolidated Consolidated

Sep 2017 Dec 2016 YTD % Sep 2017 Dec 2016 YTD %

Assets 1,309,458 1,051,814 257,644 24% 1,347,331 1,076,690 270,641 25%

Advances - net 440,904 347,980 92,924 27% 465,888 364,334 101,554 28%

Investments 682,268 555,929 126,340 23% 685,801 556,770 129,030 23%

Cash and Balances with Banks &

Lending to Financial Institutions 111,634 81,376 30,258 37% 118,036 85,743 32,293 38%

Other Assets (including fixed assets & DT) 74,652 66,529 8,122 12% 77,606 69,843 7,763 11%

Liabilities 1,152,969 910,187 242,782 27% 1,187,287 930,730 256,557 28%

Deposits 962,500 781,430 181,070 23% 989,373 795,690 193,684 24%

Borrowings 136,512 74,515 61,997 83% 142,157 77,439 64,718 84%

Subordinated loans 3,893 - 3,893 0% 3,893 - 3,893 0%

Bills Payable 15,052 12,844 2,209 17% 15,335 13,291 2,044 15%

Other Liabilities 35,011 41,398 (6,388) -15% 36,528 44,310 (7,783) -18%

Net Assets 156,489 141,627 14,863 10% 160,044 145,960 14,084 10%

Equity without surplus (incl. M.I) 138,106 117,946 20,159 17% 140,741 120,661 20,079 17%

Non Performing Loans (NPLs)


Rs. In mln Rs. In mln Rs. In mln Coverage ratio* at 93.47% (YE16: 90.82%), NPLs ratio stands at 10.11%**(YE16: 5.90%)

Sep 17*** Jun 17 Mar 17 Dec 16 Sep 16

Total NPLs 49,251 22,478 21,162 21,688 22,006

QoQ 26,773 1,316 (527) (318) 1,450

QoQ % variance 119% 6% -2% -1% 7%

Substandard 929 3,140 323 75 2,097

QoQ

(2,211) 2,817 248 (2,022) 1,589

QoQ % variance -70% 872% 331% -96% 313%

Doubtful 197 202 174 363 788

QoQ (5) 28 (189) (424) 140

QoQ % variance -3% 16% -52% -54% 22%

Loss 47,918 19,070 20,467 21,218 19,077

QoQ 28,849 (1,398) (751) 2,141 (278)

QoQ % variance 151% -7% -4% 11% -1%

OAEM 206 67 197 32 45

QoQ 140 (131) 165 (13) (1)

QoQ % variance 210% -66% 518% -28% -2%

YTD (Sep 17 vs. Dec 16)***

Var. %

Total NPLs *** 27,562 127.08%

Substandard 854 1140%

Doubtful (166) -46%

Loss 26,700 126%

OAEM 175 547%

Concentration of Category of NPLs

Sep 17 Jun 17 Mar 17 Dec 16 Sep 16

Substandard 1.89% 14.0% 1.5% 0.3% 9.5%

Doubtful 0.40% 0.9% 0.8% 1.7% 3.6%

Loss 97.29% 84.8% 96.7% 97.8% 86.7%

OAEM 0.42% 0.3% 0.9% 0.1% 0.2% *Coverage ratio = Specific plus General Provision/NPLs **Infection Ratio excluding Ex-NIB portfolio is 5.03% ***Includes NPLs transferred from Ex-NIB Rs. 29.406B

Investments


Rs. In mln

Increase of Rs. 118.72B in Market Treasury Bills and increase of Rs. 14.91B in Pakistan Investment Bonds.

Sep 2017 Dec 2016 Var. % var. Sep 2016 Var. % var.

Treasury Bills 416,108 297,386 118,723 40% 233,665 182,443 78%

Pakistan Investment Bonds 215,046 200,132 14,914 7% 209,092 5,954 3%

TFCs, Debentures, Bonds and Certificates 6,854 5,977 877 15% 6,189 665 11%

Other government securities 1,129 6,377 (5,248) -82% 2,779

(1,650) -59%

Shares in Listed, Unlisted Co.s & Mutual funds 24,765 19,077 5,689 30% 17,142 7,623 44%

Sukuks Bonds & Treasury Bonds (Sri Lanka) 722 36 686 1889% 36 686 1889%

Subsidiaries & Associated Undertakings 11,595 11,691 (96) -1% 11,713 (118) -1%

Investments at cost 676,219 540,675 135,544 25% 480,616 195,603 41%

Prov for diminution in value of investments

(2,991) (1,887) (1,104) 59%

(2,068)

(923) 45%

Surplus on revaluation of securities 9,040 17,140 (8,100) -47% 18,614

(9,574) -51%

Investments at revalued amount - net of provision

682,268 555,929 126,340 23% 497,162 185,107 37%

Source: System Deposits, State Bank of Pakistan. In the absence of domestic numbers of peer banks, total deposits base has been used in the computation.

Deposits Rs. in mln


CASA reported at 93.45%, Increase recorded in Current Deposits +24%, Saving Deposits +21%, Term Deposits +37%. YTD increase/decrease YTD

Current deposits 24%

Savings deposits 21%

CASA 22%

Term Deposits 37%

Total Deposits 23%

Volume Mix Volume Mix Volume Mix Volume Mix Volume Mix

Deposits - Volume 962,500 891,551 818,950 781,430 754,885

Current deposits 368,553 38% 368,779 41% 318,132 39% 298,032 38% 288,869 38%

Savings deposits 530,883 55% 469,570 53% 454,369 55% 437,519 56% 422,381 56%

Term Deposits 63,064 7% 53,201 6% 46,448 6% 45,879 6% 43,635 6%

CASA 899,436 93.45% 838,349 94.03% 772,502 94.33% 735,550 94.13% 711,250 94.22%

Variance YoY QoQ YoY QoQ YoY QoQ YoY QoQ YoY QoQ

Current deposits 28% 0% 22% 16% 16% 7% 16% 3% 11% -4%

Savings deposits 26% 13% 14% 3% 12% 4% 11% 4% 4% 3%

CASA 26% 7% 18% 9% 13% 5% 13% 3% 7% 0%

Term Deposits 45% 19% 24% 15% 15% 1% 0% 5% -8% 2%

Total Deposits 28% 8% 18% 9% 13% 5% 12% 4% 6% 0%

YTD QoQ YTD QoQ YTD QoQ YTD QoQ YTD QoQ

181,070 70,950 110,121 72,600 37,520 37,520 84,625 26,545 58,080 (549)

Market Share (Domestic) QoQ QoQ QoQ QoQ QoQ

Industry 11,979,886 -0.01% 11,980,697 7.26% 11,170,035 -0.29% 11,202,886 6.59% 10,510,703 0.45%

MCB 937,135 8% 866,317 9% 797,617 5% 760,419 3% 736,152 0%

Share 7.82% 7.23% 7.14% 6.79% 7.00%

Q1 17 Q4 16Q3 17 Q3 16Q2 17

Rs. In mln

Profit and Loss Statement


Unconsolidated Consolidated

Sep 2017 Sep 2016 +/- % Sep 2017 Sep 2016 +/- %

Mark-up Income 55,620 52,012 3,608 7% 57,077 53,286 3,791 7%

Mark-up Expense 24,164 18,297 5,867 32% 24,790 18,722 6,068 32%

Net Mark-up Income 31,456 33,716 (2,259) -7% 32,286 34,564 (2,277) -7%

Non Interest Income 13,856 11,858 1,998 17% 14,216 12,080 2,136 18%

Total Income 45,312 45,574 (262) -1% 46,502 46,644 (141) 0%

Non Mark-up Expense 21,210 17,266 3,944 23% 22,815 18,314 4,500 25%

admin expenses 20,384 16,747 3,638 22% 21,984 17,777 4,207 24%

PF reversal (361) (333) (28) 8% (361) (333) (28) 8%

other charges 1,186 853 334 39% 1,191 870 321 37%

Share of Undertaking - - - - 495 976 (481) -49%

Profit before Provisions 24,102 28,308 (4,206) -15% 24,182 29,305 (5,123) -17%

Provisions (1,897) (856) (1,040) 122% (1,894) (802) (1,091) 136%

against Investments 575 (466) 1,041 - 575 (466) 1,041 0%

against loans & advances (2,472) (390) (2,082) 534% (2,469) (336) (2,133) 634%

Profit before Tax 25,999 29,164 (3,165) -11% 26,076 30,107 (4,031) -13%

Taxation 6,860 11,738 (4,877) -42% 6,953 12,209 (5,256) -43%

Profit after Tax 19,138 17,426 1,712 10% 19,123 17,898 1,224 7%

* Coverage ratio is based on specific plus general provision ** Coverage ratio based on specific provision (excld. GP) plus benefit of liquid securities Net revenue= net markup income + non-markup income

Key Performance Ratios


BV ROA ROE EPS

(annualised) CAR ADR

Infection ratio

Coverage ratio*

Coverage (incl. benefit

of liquid sec)**

Non-markup/Total

Rev

Sep 2017 116.54 2.16% 19.93% 22.47 17.34% 50.59% 10.11% 93.47% 97.34% 30.58%

Jun 2017 109.65 2.31% 22.82% 24.60 17.43% 45.69% 5.52% 78.76% 85.46% 32.55%

Mar 2017 107.47 2.14% 20.70% 22.09 18.12% 45.48% 5.68% 89.46% 97.55% 34.75%

Dec 2016 105.97 2.13% 18.94% 19.67 19.33% 47.05% 5.90% 90.82% 98.76% 27.04%

Sep 2016 105.23 2.35% 20.18% 20.88 19.94% 46.69% 6.24% 81.84% 89.76% 26.02%

Jun 2016 103.23 2.05% 18.78% 19.25 18.54% 47.67% 5.71% 86.49% 96.75% 20.57%

Mar 2016 102.79 2.35% 21.15% 21.62 18.15% 44.20% 6.51% 86.35% 95.72% 20.71%

Dec 2015 101.69 2.63% 23.21% 22.95 19.43% 46.29% 6.32% 90.37% 99.82% 25.14%

Sep 2015 101.20 2.74% 24.55% 24.22 20.13% 45.67% 6.40% 85.16% 94.08% 25.56%

June 2015 99.21 2.68% 24.92% 24.33 19.02% 43.52% 6.36% 84.98% 93.59% 26.90%

Mar 2015 99.19 3.25% 29.13% 28.43 19.54% 43.96% 6.70% 85.36% 93.87% 29.84%

Dec 2014 96.05 2.78% 23.83% 21.85 20.41% 46.83% 6.80% 85.62% 94.00% 22.93%

Sep 2014 94.09 2.87% 23.93% 21.71 20.46% 46.24% 7.12% 84.62% 95.11% 22.98%

June 2014 91.68 2.79% 23.53% 21.07 20.22% 44.19% 7.29% 85.60% 94.15% 20.29%

Mar 2014 89.15 2.68% 22.44% 19.81 21.09% 43.45% 8.26% 85.66% 94.23% 21.49%

Dec 2013 87.39 2.72% 23.09% 19.31 22.25% 42.41% 8.68% 85.74% 94.66% 22.78%

Sep 2013 86.81 3.03% 24.70% 20.58 24.77% 41.98% 10.17% 84.28% 92.65% 23.09%

June 2013 85.05 3.08% 25.91% 21.36 23.96% 40.08% 10.12% 86.92% 95.42% 23.70%

Mar 2013 82.68 3.02% 25.51% 20.73 22.54% 46.37% 9.41% 88.97% 97.22% 19.47%

Dec 2012 79.85 2.91% 24.59% 18.57 22.24% 48.14% 9.74% 89.23% 87.55% 18.30%

Awards / Accolades in 2017 International Recognition

Euromoney Awards 2017

Best Investment Bank in Pakistan - Winner

Asset AAA Islamic Finance Awards 2017

Project finance house, Pakistan

Asset AAA Infrastructure Awards 2017

Project finance house of the year, Pakistan

Renewable Energy deal of the year, Pakistan (for Chanar Energy Limited PKR 2.20 billion rupee syndicated term finance facility, in which MCB Bank has acted as the lead adviser and arranger)

Transport deal of the year, Pakistan (for SEPCO 12.658 billion rupee syndicated term finance facility, in which MCB Bank has acted as the lead adviser and arranger)

Asiamoney New Silk Road Finance Awards 2017

Best Regional Bank in South Asia for BRI (Belt & Road Initiative)

Best Bank for BRI-related finance in South Asia

Asian Banker Awards 2017

Strongest Bank in Pakistan

Local Recognition CFA 14th Excellence Awards

Corporate Finance House of the Year 2016 – Equity & Advisory – Runner Up

ICAP & ICMAP

Best Corporate Report Award 2016 - Winner

Best Bank Led Mobile Money Transfer Program 2010

Winner – Best Presented Annual Accounts 2014

1st Runner Up Best Presented Annual Report Awards 2013 – Category Private Sector Banks 2nd Runner Up Best Presented Annual Report Awards 2012–

Category Private Sector Banks Joint 2nd runner-up in the banking

sector - Best Presented Accounts and Corporate Governance Disclosure

Awards 2010

2012: Ranked 624, 2011: Ranked 606, 2010: 621

Country Ranking: 3rd highest among the local Top 5

Ranked among the Top 25 Companies in Pakistan

Strongest Bank in Pakistan 2017 Strongest Bank in Pakistan 2014 Strongest Bank in Pakistan 2010

“Winner -Best Corporate Report Award 2016 – Banking Sector”

Winner” - Best Corporate Report Award 2015 Winner” - Best Corporate Report Award 2014 “Winner” - Best Corporate Report Award 2013 “Winner” - Best Corporate Report Award 2012

“„Runner-up” Best Corporate Report Award 2011 “Winner - Best Corporate Report Award 2010 “Winner - Best Corporate Report Award 2009

Best Commercial Bank – Pakistan 2012

Most Stable Bank of the year 2014 Best Bank of the year 2013 – Large Bank

Most Stable Bank of the year 2013 Investor Relations Award 2011: Runner-up

Best Bank of the Year 2011 Most Stable Bank of the Year 2011

Triple A Country Awards Best Domestic Bank – Pakistan 2014: 2013: 2012:

Best Bank – Pakistan 2014

Best Investment bank in Pakistan - 2017 Best bank in Pakistan - 2016

Euromoney Awards for Excellence 2012: Best Bank in Pakistan 2011, 2008, 2003-

2005, 2001, 2000 Best Bank in Asia 2008

The QFC Asian Banker Leadership Achievement Award 2010

CSR Business Excellence Award 2012: Best Media Coverage

Best Domestic Bank in Pakistan: 2014; 2009, 2008, 2006, 2005 &

2004

Best bank in Pakistan - 2016 Best bank in Pakistan - 2015

Best bank for Corporate Finance & Capital market

Development - 2016

International Recognition Awards / Accolades

Thankyou For further details on MCB Bank Limited, please visit www.mcb.com.pk

For any query/comments/feedback, please e-mail [email protected]

MCB Bank Limited

Documents

MCB Bank Limited · With reference to significant holding, the following entities are associates of the Bank; Adamjee Insurance Company Limited Holding: 21.47% Euronet Pakistan (Private)